The Boroo gold project is located in the Republic of Mongolia some 110 kilometres to the northwest of the capital city of Ulaanbaatar and about 230 kilometres to the south of the international boundary with Russia.
The Boroo gold deposit is a low silica Au+As sulphide system associated with a zone of quartz-sericite-pyrite (QSP) alteration in the sub horizontal Boroo fault. Boroo is an intrusion related gold deposit and hosted by a Cambrian-Ordovician sequence of highly deformed shales, siltstones and fine sandstones of the Haraa turbidite sediments, and the Paleozoic granitoids of the Boroo Complex.
Gold mineralization on the Boroo project is controlled by a northerly trending thrust fault that dips at a very low angle to the west. In the northern part of the property, the thrust fault cuts across the contact between sedimentary rocks and granitic rocks, while in the southern part of the property the thrust fault is entirely contained within sedimentary rocks. Gold mineralization within the thrust fault zone is found together with disseminated sulphides in a pervasive zone of quartz-sericite alteration, and also in quartz-sulphide veins in which gold is commonly coarse grained.
To date, four zones of economic gold mineralization have been identified on the Boroo property along the trend of the thrust fault, identified as Zones 2, 3, 5 and 6. The gold mineralization and the enclosing near-surface rocks have been subject to weathering and resulting oxidation. The oxide zone, generally located near surface has undergone the highest degree of oxidation, followed by a transitional zone, and then the underlying fresh rocks in the primary zone of mineralization.
The Boroo open pit gold project was the first significant foreign investment of industrial development in the country since 1979 and after reaching commercial production on March 1, 2004 has produced in excess of 1.26 million ounces by October 31, 2009.
The proven and probable reserves as of October 31, 2009, including the stockpiles, were estimated at 615,000 ounces of contained gold, compared to 778,000 ounces of contained gold as at the year end 2008.
Measured and indicated resources were estimated at 242,000 ounces of contained gold using the same cut-off grade as the reserve estimate and no changes to the final pit design, cut-off, grade or resource block model were completed in 2009, there was no change to these resource figures relative to the 2008 year end.
